Smt Varsha Punjabi L/h of late Bhagwandas Punjabi, Ahmedabad V. The ACIT., Circle-6, Ahmedabad

ITSSA 377/AHD/2011

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 2170 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 1 month(s) 30 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 08-06-2016
• Assessment Year: misc
• Appeal Filed On: 16-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A L THAKKAR
• Keywords: Block assessment
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER . .. . ( (( ( ) )) ) / // / IT(SS)A NO.377/AHD/2011 / // / ASSESSMENT YEAR : BLOCK PERIOD 01.04.1990 TO 07.03. 2001 LATE SHRI BHAGWANDAS P. PUNJABI, THROUGH L/H VARSHA PUNJABI, 3-B, SURDHARA BUNGALOWS, OPP. GOYAL INTERCITY, DRIVE-IN- ROAD, AHMEDABAD PAN : AEHPP 2016 C VS DCIT, CIRCLE-6, AHMEDABAD / // / (APPELLANT) / // / (RESPONDENT) ASSESSEE BY : SHRI A.L. THAKKAR, AR REVENUE BY : SHRI K. MADHUSUDAN, SR DR / // / DATE OF HEARING : 08/06/2016 / // / DATE OF PRONOUNCEMENT: 15/07/2016 / // / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-XI, AH MEDABAD DATED 08.03.2011 FOR THE BLOCK ASSESSMENT PERIOD 01.04.19 90 TO 07.03.2001. 2. THE SOLITARY GROUND RAISED IS AS UNDER:- THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN CONFIRMING THE PENALTY LEVIED U/S 158BFA(2) OF THE INCOME-TAX ACT , 1961 ON THE AMOUNT OF ADDITION OF RS.4,00,000/- CONFIRMED BY THE HONB LE INCOME TAX APPELLATE TRIBUNAL VIDE ITS ORDER DATED 07.05.2010 WITH RESPE CT TO THE ALLEGED UNDISCLOSED INCOME/INVESTMENT IN TENEMENT NO.4A, NA VENDU CO. OP. HO. SO., MEMNAGAR, AHMEDABAD 3. THE BRIEF FACTS ARE A SEARCH OPERATION U/S 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF SHRI DEVENDRA GAJENDRANATH CHATU RVEDI (DGC IN SHORT) AND DURING THE COURSE WHEREOF, KEYS OF THE PROPERTY , I.E., TENEMENT NO.4A, NAVENDU CO-OPERATIVE HOUSING SOCIETY, MEMNAGAR, AHM EDABAD WERE SEIZED. ON QUESTIONING, DGC STATED THAT THESE PREM ISES WERE PURCHASED BY HIM FROM THE ASSESSEE SHRI BHAGWANDAS P. PUNJABI FO R A CONSIDERATION OF RS.12 LACS. DURING BLOCK ASSESSMENT, DGC DENIED TH IS STATEMENT. TO CROSS SMC-IT(SS)A NO. 377/AHD/2011 LATE SHRI BHAGWANDAS P. PUNJABI VS. DCIT BLOCK PERIOD 01.04.90 TO 07.03.01 2 VERIFY, ASSESSEE WAS SUMMONED WHO ACCEPTED THE OWNE RSHIP OF THE PROPERTY. THE ASSESSEE WAS ASKED TO EXPLAIN THE SOU RCE OF INVESTMENT WHICH HE COULD NOT PRODUCE. CONSEQUENTLY, PROCEEDINGS U/ S 158BD WERE INITIATED AND THE BLOCK ASSESSMENT WAS COMPLETED AND THE ADDI TION WAS MADE AS THE ASSESSEE COULD NOT EXPLAIN THE SOURCE. THE ASSESS EE AGITATED THE ADDITION IN APPEAL. ITAT VIDE ORDER DATED 07.05.2010 RESTRICTE D THE ADDITION IN THIS BEHALF TO RS.4 LACS. PENALTY PROCEEDINGS WERE INIT IATED U/S 158BFA(2) OF THE ACT. ACCORDING TO AO, IN PENALTY PROCEEDINGS, ASSES SEE NEITHER APPEARED NOR MADE ANY SUBMISSIONS. CONSEQUENTLY, PENALTY @ 100% OF THE TAX SOUGHT TO BE EVADED WAS IMPOSED. 4. AGGRIEVED, ASSESSEE PREFERRED FIRST APPEAL; BY T HE TIME, ITAT ORDER HAD COME REDUCING THE ADDITION TO RS.4 LACS. ASSESS EE MADE DETAILED WRITTEN SUBMISSIONS WHICH ARE MENTIONED IN PARAGRAPH 2 TO 5 OF THE LD. CIT(A)S ORDER. LD. CIT(A), RELYING ON ITATS OBSERVATIONS, IMPOSED THE IMPUGNED PENALTY. 5. AGGRIEVED, THE ASSESSEE IS IN SECOND APPEAL. 6. LD. COUNSEL FOR THE ASSESSEE CONTENDS THAT THE A SSESSEE HAS EXPIRED AND THE PRESENT APPEAL AGAINST THE CONFIRMATION OF PENALTY HAS BEEN FILED BY THE LEGAL HEIRS. THE ORDERS OF THE AUTHORITIES BEL OW IMPOSING PENALTY ARE ASSAILED ON FOLLOWING POINTS:- I) THE OBSERVATIONS OF BOTH THE LOWER AUTHORITIES THAT THE ASSESSEE NEITHER ATTENDED NOR FILED ANY SUBMISSIONS ARE NOT CORRECT INASMUCH AS IN REPLY TO ASSESSING OFFICERS SHOW-CA USE NOTICE 11.03.2008, ASSESSEE FILED WRITTEN SUBMISSIONS DAT ED 20.03.2008 EXPLAINING THAT THE PROPERTY IN QUESTION WAS PURCHA SED HAS THE SOURCE OF RS.4 LACS RECEIVED FROM THE WILL OF ONE S MT.SHARADABEN R. SHAH (WIFES AUNT), WHO DEMISED WITHOUT ANY OFFS PRING. THE SMC-IT(SS)A NO. 377/AHD/2011 LATE SHRI BHAGWANDAS P. PUNJABI VS. DCIT BLOCK PERIOD 01.04.90 TO 07.03.01 3 COPY OF THE WILL ALONGWITH AFFIDAVIT CERTIFICATE OF THE EXECUTOR WAS FILED. II) IT WAS FURTHER CONTENDED THAT, ALTERNATIVELY, THE P ENALTY PROCEEDINGS MAY BE KEPT IN ABEYANCE TILL THE QUANTU M APPEAL WAS DECIDED BY THE LD. CIT(A). LD. ASSESSING OFFICER, HOWEVER, DID NOT CARE TO APPRECIATE THIS SUBMISSION AND ERRONEOU SLY HELD THAT ASSESSEE HAS NEITHER ATTENDED NOR FILED ANY SUBMISS IONS. THUS, THE IMPOSITION OF PENALTY BY THE LD. AO IS ON MISCONCEP TION OF FACTS, NON-CONSIDERATION OF RECORDS AND ARBITRARY. III) THE LD. CIT(A) HAS ALSO RELIED ON THE LD. AOS FIND ING THAT THE ASSESSEE DID NOT APPEAR BEFORE THE LD. AO AND ITAT IN QUANTUM PROCEEDINGS HAS UPHELD THE ADDITION. IT IS VEHEMEN TLY ARGUED THAT PENALTY PROCEEDINGS ARE DISTINCT AND SEPARATE; AND MERELY BECAUSE THE ADDITIONS ARE CONFIRMED IN QUANTUM, THA T BY ITSELF CANNOT BE A GROUND TO IMPOSE PENALTY. IV) LD. CIT(A) ALSO FAILED TO CONSIDER THE MERITS OF TH E ASSESSEES REPLY AND ITS RELIANCE ON THE FOLLOWING JUDGMENTS:- A) GANDHI SERVICE STATION VS. ACIT (2006) 100 TTJ (AHD TRIB) 1143 B) DCIT VS. KOATEX INFRASTRUCTURE LTD (2006) 286 ITR 4 0 (MUM TRIB) C) DHEERAJ SONI V. ACIT, (2006) 96 ITD 187 (DEL TRIB.) D) ITO VS. PREMILA PRATAP SHAH, (2006) 100 ITD 160 (MU M TRIB) E) JASWANT D. PARMAR VS. ACIT (2007) 109 TTJ (AHD TRIB ) 56 F) DHIRAJ SURI VS. ACIT, (2006) 98 ITD 187 (DELHI TRIB ) V) FURTHER RELIANCE IS PLACED ON FOLLOWING GUJARAT HI GH COURT JUDGMENTS:- A) KANDOI BHOGILAL MULCHAND VS. DCIT, (2012) 341 ITR 2 71 (GUJ.) B) CIT VS. BECHARBHAI PARMAR, (2012) 341 ITR 499 (GUJ. ) C) CIT VS. SATYENDARA KUMAR DOSI, (2009) 315 ITR 172 D) IT IS CONTENDED THAT NON-CONSIDERATION OF ASSESSEE S REPLY AND HOLDING THAT ASSESSEE DID NOT FILE ANY EXPLANATION ARE MISTAKEN SMC-IT(SS)A NO. 377/AHD/2011 LATE SHRI BHAGWANDAS P. PUNJABI VS. DCIT BLOCK PERIOD 01.04.90 TO 07.03.01 4 FINDING OF FACT AND ANY PENALTY IMPOSED ON CONSIDER ATION OF SUCH ERRONEOUS FACTUAL FINDING IS UNTENABLE. ON BEHALF OF THE LEGAL HEIRS, IT IS CONTENDED THAT THE PENALTY MAY BE DELE TED. 7. ON THE OTHER HAND, LD. SR. DR. SUPPORTED THE ORD ERS OF THE LOWER AUTHORITIES. 8. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE LOWER AUT HORITIES. BOTH THE AUTHORITIES BELOW HAVE DRAWN ADVERSE INFERENCE BY O BSERVING THAT THE ASSESSEE NEITHER REMAINED PRESENT NOR FILED SUBMISS IONS BEFORE THE ASSESSING OFFICER. THIS OBSERVATION IS INCORRECT I N VIEW OF ABOVE FACTS. BE THAT AS IT MAY, A DETAILED REPLY WAS FILED BEFORE T HE LD. CIT(A) ALSO. LD. CIT(A) HAS CONFIRMED THE PENALTY HOLDING THAT THE A SSESSEE DID NOT COOPERATE AND ITAT HAS CONFIRMED THE ADDITION; THE LD. CIT(A) OUGHT TO HAVE CONSIDERED THE MERITS OF THE ASSESSEES CONTEN TIONS. THE ASSESSEE HAS EXPLAINED THAT THE AMOUNT IN QUESTION DEVOLVED ON T HE ASSESSEE BY WAY OF INHERITANCE, I.E., WILL OF SMT. SHARADABEN R. SHAH. THE COPY OF THE WILL AND AFFIDAVIT OF THE EXECUTOR HAVE BEEN FURNISHED. THE MERITS OF THESE MATERIALS AVAILABLE ON RECORD HAVE NOT BEEN CONTROV ERTED. IN CONSIDERATION OF ALL THESE FACTS AND CIRCUMSTANCES, I AM OF THE V IEW THAT THIS IS NOT A FIT CASE FOR IMPOSITION OF PENALTY WHICH IS DELETED. ASSESSE ES APPEAL IS ALLOWED. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JULY, 2016 AT AHMEDABAD. SD/- R.P. TOLANI (JUDICIAL MEMBER) AHMEDABAD; DATED /07/2016 *BIJU T. SMC-IT(SS)A NO. 377/AHD/2011 LATE SHRI BHAGWANDAS P. PUNJABI VS. DCIT BLOCK PERIOD 01.04.90 TO 07.03.01 5 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE. / BY ORDER, TRUE COPY / // / ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD